Predicting change in a Time of War and an Age of Wonder

It turns out that once you start mapping out environments you can determine common or sort of economic patterns. So how efficiency enables innovation and how we have inertia and how inertia kills organisations and how the economy goes through cycles, through a stage of peace, war and wonder. And there is an awful lot which is predictable about change. It’s not this completely random sort of thing that we are led to believe. A lot in terms of how things evolve with is actually predictable. Now the interesting change is when it comes to prediction you can often actually say what is going to happen but not necessarily when or you can say when something is going to happen. But not necessarily what and mapping just like looking at a chess board gives you a way of narrowing down on the scope of those change. So we are going through a particular part of the economic cycle at the moment which is caused through commoditization of a range of activities. So we are seeing disruption of pre-existing industries but as a result you also get explosion of new things being created. So you get this time of war in terms of past industries being destroyed and this time of wonder in terms of new things are rapidly being created. Nothing new with that we have gone through seven of those economic cycles in the last 300 years. It doesn’t matter where it is the age of electricity or the mechanical age they are all the same. But the advantage of mapping is you can start to manipulate that to your favour. It enables you to spot what is likely to occur and so that’s what the project is about how we apply those techniques to identify what is going to occur.

Predicting change in a Time of War and an Age of Wonder

It turns out that once you start mapping out environments you can determine common or sort of economic patterns. So how efficiency enables innovation and how we have inertia and how inertia kills organisations and how the economy goes through cycles, through a stage of peace, war and wonder. And there is an awful lot which is predictable about change. It’s not this completely random sort of thing that we are led to believe. A lot in terms of how things evolve with is actually predictable. Now the interesting change is when it comes to prediction you can often actually say what is going to happen but not necessarily when or you can say when something is going to happen. But not necessarily what and mapping just like looking at a chess board gives you a way of narrowing down on the scope of those change. So we are going through a particular part of the economic cycle at the moment which is caused through commoditization of a range of activities. So we are seeing disruption of pre-existing industries but as a result you also get explosion of new things being created. So you get this time of war in terms of past industries being destroyed and this time of wonder in terms of new things are rapidly being created. Nothing new with that we have gone through seven of those economic cycles in the last 300 years. It doesn’t matter where it is the age of electricity or the mechanical age they are all the same. But the advantage of mapping is you can start to manipulate that to your favour. It enables you to spot what is likely to occur and so that’s what the project is about how we apply those techniques to identify what is going to occur.

The Age of Wonder

We may not know exactly what the future holds, but we can predict roughly what's going to happen. A cycle of product evolution, leading to commoditisation in the utility services, and when things become plentiful in the utility sense, new things become possible. There's an example when compute becomes utility in the Amazon.com and the Amazon web services sense. The whole of Silicon Valley start-ups of the last five years can kind of become possible building on that. And so we know and we can make a few bets based on those kind of things. So the point of the Age of Wonder is to say, great, this is a great theory, let's try it out. Let's pick various areas, such as currency, tax, and so on, and say, well let's use the model and predict a bit of the future, and show business some of the ways in which the world as we know it today is going to be radically changed in the next decade.

How LEF’s Mapping helped ETS create a disruptive strategy

Simon Wardley has been, come out to ETS and has been very helpful in helping us map. We used his concept of strategic mapping to help us understand what parts of our existing applications and platforms we should move towards commodity status, and work with the lowest cost providers, and others that we really focused on maintain as core, and then those ones that could be disruptive, the ones that we really need to think differently about, that could potentially become an eco-system of themselves, and that we could build around a platform. So it's a great exercise to go through, I really think others should give it a try, we've learned a lot from it and we now have a great map that shows all of our applications and where they fit.

How the mapping process works

It is very simple I can come in and show and spend a day with you ding a workshop, teaching you how to map and then I walk away. The key thing about mapping an environment is the only people who can map an environment are actually those who are playing the game within the business. So it’s not a consultancy gig where you say can you come and map my environment for you etc. You have to unfortunately do it yourself, it is like playing a game of chess, I can show you the techniques but you have to draw the board and you have to play the game. But that’s what I do I come and do a workshop. The first day workshop is the about how to map it and the second one is more about the generic strategic game play. And of course you then have to apply that to your own industry. Mapping does not take away thought unfortunately you still have to think about how to play the game. But at least it shows you the board.

How Mapping helps you make strategic plays

So mapping I suppose, the best way of describing in terms of impact, is imagine you're playing a game of chess and you've never before looked at the board, mapping shows you what the board looks like. So it rapidly improves your ability to play the game.
I have done this within government for things like high speed rail, Home Office, the police, immigration border control, and we've done it within pharmaceutical companies, media companies, so all sorts of different industries. There's a couple of immediate impacts, first it gets everybody to focus on the user need. You often get projects, big specifications, very difficult to understand what the user need is, maps provide a visual way of seeing that.
Secondly, it teaches you about how to apply multiple methodologies, so rather than being six sigma outsource, or agile insource, you learn to break down large projects and use multiple methods. That can lead to enormous cost savings and risk reductions. The elephant part of that is actually risk reduction itself, and by mapping out the environment we've had huge - these are billion dollar projects - where they discover that the contract arrangement is not ideal.
The other thing mapping is great for is communication, mostly business IT alignment issues people talk about are usually artefacts of how we all organise and poor ways of communication. Mapping is a way of everybody being able to see what is going on in the landscape and we've found it has really simplified communication in large organisations.
So beyond saving costs, applying the right methods, focusing on user needs, improving communication, risk management, it's also fantastic for strategic planning, situational awareness, so there's a whole host of other techniques of learning. Learning about how the economy is changing, learning about how you can improve your environment based upon competitors actions, which come into play as well.
The comments we get back are generally fantastic. I say generally, I have never had any negative comments.

Strategic plays now more important than strategy execution

So when we talk about economic change there’s actually a standard process for how organisations evolve. So when we look at the commoditization of a pre-existing act, say electricity or compute you often get new practices emerge and then those new organisations form around those new practices and they dominant. So the electricity age we got forwardism, the mechanical age we got the American system, internet age we got Web 2.0. Cloud we’re getting basically a new generation of companies. Now we often have these sorts of debates about whether strategy matters. I mean Jamie Dimon once said that you know execution is the key to a strategy success. Well it turns out that this next generation of organisations appearing with Cloud have slightly different ways of playing at the strategic game. They have very high levels of what you would call situational awareness. And I did a piece of work a couple of years back. Back in 2011 which mapped the phenotype, the characteristics of these next generation companies. And then in 2012 we looked at the level of strategic play against that action in this case it was the use of open to manipulate markets. And what we found was strategic play was critical, more important than execution. So players are a particular group of companies who tend to have extremely high levels of strategic play and they tend to act on it. So they do things like use open as a way of manipulating markets and those companies have had massive market growth over the last 7 years. Now there is another group of companies called chancers which tend to have low levels of strategic play and don’t tend to act very effectively. For example don’t use open as a way of manipulating markets and they have tended to show very negative market cap or stagnation over the last 7 years. So players are a particular type of new form of organisation which have very high levels of strategic play and that turns out to be critical for completion.

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